China's Chery group matures into global auto player

FE Team | Published: September 24, 2007 00:00:00 | Updated: February 01, 2018 00:00:00

WUHU, China, Sept 23 (AFP): China's Chery Auto sales vice president Jin Yibo remembers when the roof in the president's office had a leak so big that they had to put out buckets to collect the water.
"Those were tough times," said Jin, shaking his head in disbelief as he recalled Chery's humble beginnings 10 years ago.
It was March 1997, and the firm based in Anhui, one of China's poorest rural provinces, had been established with 1.7 billion yuan (225 million dollars) of government money but had never turned out a car.
"There was nothing here, this was just fields," said Lucas Biagini, chief executive of Italian parts supplier Magneti Marelli that now earns about 30 per cent of its China sales from the upstart Chinese group.
The plant's spectacular expansion reflects how Chery has successfully grown from "young boys into mature people," Biagini said.
With little industrialisation to speak of, the provincial government quixotically cast its fortunes in with the auto industry, betting that China's 1.3 billion people would soon have enough money to buy their own set of wheels.
"The decision was correct," Chery vice president Zhou Biren told Western journalists invited to tour its ultra-modern headquarters in eastern China for the first time.
Chery's home in the Yangtze river port city of Wuhu is today a massive industrial park, housing not only the company's vast high-tech plants, but major American, European and Japanese auto engineering firms.
The proximity of its overseas suppliers such as Visteon, Bosch and Siemens has been critical to the rapid growth of a firm that recognised from the start its ambitions had to be built on the back of foreign technology.
"We have received a lot of help from foreign companies, said Lei Gu, a Ford trained engineer, who is one of 70 key engineers that has worked overseas for global manufacturers.
Inside the plant hums with the best German, American and Italian machinery money can buy as busy workers set about the complex assembly and testing that allow Chery to produce 400,000 independent-branded cars and engines a year.